subrogate
To replace one person or thing with another.
transitive
A co-debtor that pays off a principal creditor has a choice. It can subrogate to the principal creditor's claim or it can file its own claim in the bankruptcy. It cannot do both; its own claim will be disallowed if it seeks subrogation.
Where it comes from
Borrowed from Latin subrogātus, perfect passive participle of subrogō, from sub (“under”) + rogō (“to ask, request”). A variant of surrogate.
Adapted from the Wiktionary entry subrogate (CC BY-SA 4.0).